Interview with Akhil Gupta, Vice-Chairman, Bharti Enterprises

India’s massive telecom expansion has been driven by significant investments parked in network and spectrum. While telecom user growth and service consumption have surged to unprecedented levels, telcos’ return on capital employed remains poor. The financial recovery of the sector, through ARPU increases and capex sharing, will be crucial for the successful roll-out of future technologies. In an interview with tele.net, Akhil Gupta, Vice-Chairman, Bharti Enterprises, discusses the progress of the Indian telecom sector over the past 25 years, its biggest challenges, the way forward and Bharti’s future focus areas. Edited excerpts…

How would you assess the performance of the tele- com sector over the past 25 years?

Over the past 25 years, telecom has emerged as one of the key sectors in the country, truly transforming it. About 25-30 years back, securing a telephone connection was considered a big achievement. From then to now, it has been a transformative journey, with almost every individual owning a mobile phone today.

The idea that almost everyone in the country would be connected is something that had seemed unimaginable, even to those who entered the tele- com sector decades ago. Back then, we could not have imagined market penetration or data consumption reaching such high levels. India has over a billion subscribers at present, and the average data consumption has surged to about 25 GB per month per user. This speaks volumes about the technology adoption that telecom has enabled.

This democratisation of telecom has, in my view, been the most significant development.

How would you describe the current telecom scenario?

I believe the sector is now relatively stable, although it is still not at a level where it should be, particularly in terms of return on capital employed, which continues to be poor, even for a top player like us, and needs to improve. We are still more or less in single digits.

In terms of network penetration and expansion, I believe it to be a very satisfying story. However, financially, we still need to repair.

What are the big issues?

The ARPU needs to go up. The industry must aim for ARPU levels of around Rs 300 for continued investment in the sector. To this end, some more tariff repairs are required.

So, who is it up to – the government, or the telcos?

I would say both. Many a time, players, owing to the competitive intensity, have not been able to make changes. However, telecom prices must gradually increase, like those of any other commodity, in sync with inflation, because costs definitely continue to increase.

What can the government do?

It will be impractical for us to say what the government should mandate. I believe what will help is to take a pragmatic view whenever a price rise is proposed, and be supportive of that.

What is your perspective on the tower industry in India?

For towercos, sharing has been a very successful business model, not only in India but all over the world. In India, we pioneered this concept – we created a unique towerco by bringing together three intense competitors to share their infra- structure. This has been a resounding success story. What we started in India is being practised all over the world today.

Unfortunately, from 2008 till 2025, this concept of sharing has largely been limited to towers. I believe India can take the lead in expanding the scope of sharing to other digital infrastructure as well, starting with passive infrastructure such as fibre and moving towards active infrastructure sharing over time.

One of the biggest problems of the telecom industry, not just in India but world over, is that despite being the most indispensable industry, it is also the most undervalued one. The reason is simple – telecom is considered one of the most asset-heavy sectors, leaving little room for value creation. The capex is massive, which impacts cash flows. The simple solution is: capex must come down, and one way of achieving this is to share infrastructure. There is considerable superfluous capacity being created in the sector and if telcos were to share it, both capex and opex could be rationalised.

The industry has been talking about it for some time. For towercos, of course, it happened relatively fast, but for netcos not so much.

So why is that taking so long?

I think the reason is that towers were mainly identified with coverage and once operations started matching coverage, it was relatively easy for operators to share towers.

However, on active networks, the industry has always believed that to be a very important differentiator vis-à-vis competition. It has accordingly taken much longer for active network sharing to take place.

I am pleased to note that active network sharing has started in some countries between operators that are close to each other in size. The future, I believe, will be the creation of netcos on the lines of towercos, which could transform this sector with lower capex and opex for individual operators.

What is your opinion on the progress of 5G in India so far?

For 5G, the expectations were, in my view, pretty impractical – everybody expected it to be a magic pill with better speeds and lower latency. A lot was being said about private networks and applications such as robotics surgery and driverless cars running on 5G. The truth is some of these advancements are taking longer than expected.

According to me, what people forget is that 5G is  first and foremost about the provision of larger capacities needed for data. The cost per GB of data production on 5G is significantly lower than on 4G. In addition, one new category, fixed wireless access, has emerged and is performing very well on 5G.

How has the past year been for Airtel?

Besides India, our overall African business has also done quite well and will settle at almost $6 billion in revenue, heading towards the $3 billion EBITDA mark. It is a sizable business spanning 14 countries. Last year, of course, we faced a setback because of the Nigerian currency crisis. But in constant currency terms, Nigeria continues to grow very well and over time, will overcome the currency devaluation. We have seen this in the past and I am sure this time it will happen again.

In addition, we recently acquired a minority stake in BT. Let us see how things work out there.

The satellite segment, particularly the LEO satellite industry, is looking extremely interesting. Of course, we have a big elephant in the room there, in the form of Starlink, which is creating large capacities. That said, we are the only other LEO  constellation in operation today. Further, we are not focusing on retail customers but on the government, enterprise, military, marine, and aviation sectors, and I believe we will do quite well there.

What will be Bharti Airtel’s key priorities and focus areas in 2025?

Our key priority will always be to provide the best services to our customers and for that, besides a great network, we will use the best IT services including artificial intelligence.

What is your outlook for the sector?

I believe that if the telecom sector, in India and globally, can address the issue of being asset-heavy by stepping up the sharing of active and passive infrastructure amongst operators, the future will be glorious. This is one sector that will always stay relevant.